EPLI Trends: Why You Should Reassess your Coverage
Employment practices liability (EPL) claims are a significant area of exposure for companies. Across the country there has been an increasing trend of EPL claims and exposures. There are a number of factors for this increase, including trends that could offer the amount of EPLI coverage you offer to your clients.
First, there’s an obvious increase in sheer numbers. The Equal Employment Opportunity Commission (EEOC) received 99,447 charges from employees alleging employment practices violation- including discrimination, retaliation and harassment- against their employers. The number set a record for the second straight year in a row. The EEOC also obtained a record monetary recovery on behalf of employees- $364.6 million in one year.
There has also been increased regulatory action. Recent regulations enforcing the Americans with Disabilities Act Amendments Act that broadened the definition of “disability” and could expand employers’ obligation to provide reasonable accommodation to more employees. Additional regulatory and enforcement activities by the EEOC and the Office of Federal Contract Compliance Programs have also contributed to the higher purchasing trends seen across industry sectors.
Companies across all industries purchased an average of $10.2 million in total EPLI limits in 2011- the median limits purchased were $5 million. The benchmark amounts for large companies are much higher with due to their higher employee counts, averaging $28.3 million in EPLI limits with a median of $15 million.
As a result of these trends, many organizations are altering their EPLI limits, increasing coverage when necessary to address these changing risks. Running a professional business automatically exposes your clients to extraordinary liability risks. With the increased pressure and aggressive stance by the EEOC, businesses are increasingly facing allegations for racial and religious discrimination, sexual harassment, FMLA violations, unfair pay and other significant claims. Even firms that adhere strictly to best practices can find themselves accused of errors or allegations that result in significant loss.
PL Risk Advisors offers clients in all classes of business a competitive EPLI product designed to cover legal fees, settlements and damage awards that result from EPLI claims. Contact us today for more information.